Steli Efti, CEO and Co founder of Close has published an article in Fobes website to help every startup understand better on sales pipeline management. We have been hit by Covid-19 pandemic that pushed us to the situation where we need to allocate our limited resources tactfully.
We must take advantage of our sales pipeline to ensure that we grab every opportunity and close the deal at all costs.
These are 6 things that could help you fully utilize your sales pipeline
- How You Manage Your Pipeline Has A Direct Impact On Your Growth
If managing your pipeline has been knocked off your priority list, it’s time to put it back on the top. Here’s why: According to a study by the Harvard Business Review, companies that had effective pipeline management saw their growth rate increase by 15%.
When your sales pipeline is managed correctly, it can tell you at a glance whether or not you’re going to reach your goals, how your reps are performing, and where you need to focus your efforts right now.
The perfect recipe for startup growth is a combination of taking those insights and putting them to practical use.
2. The Best Sales Pipelines Are Built Around Your Unique Process
Sales pipelines generally follow these stages:
However, your sales pipeline doesn’t have to follow the rules. Remember: your market, your prospects, and your sales process are all unique aspects of your startup. What works for another company may not work for you, and vice versa.
Your process is unique to you: Don’t accept anything less from your pipeline.
In fact, unless your pipeline is customized to your unique sales process, it will never help you grow.
So, when building your pipeline, define each stage by your own particular process. For example, do you normally have a meeting with your product champion before you do a product demo? Do you need to arrange matters with your prospect’s legal team before you can draw up a contract? Are there specific actions you take after the close, such as product onboarding, delivery, or implementation?
With a clearly defined sales process, you can build a pipeline that guides your sales team and helps you grow faster. Just make sure that wherever you build your pipeline, you can fully customize the stages.
3.Combining Your Rep Activity Data And Conversion Rates Can Empower Your Team
Your sales pipeline contains a lot of data. And it’s way too easy to get caught up in the excitement of ‘gathering more data’.
But all that data you gather will be absolutely useless to you unless you can turn it into something practical.
So, instead of gathering large amounts of data from your pipeline, focus on tracking your key metrics. Generally, some of the most important metrics effective sales pipeline analysis are:
- Pipeline value
- Sales pipeline velocity
- Conversion rate per stage
But your startup has its own unique KPIs that matter more to you and have a bigger impact on your bottom line.
For example, a SaaS startup should care more about MRR, customer lifetime value, cost per acquisition, and sales cycle length. These metrics will tell a SaaS startup how valuable each lead could be and how close they’ll get to their revenue goals with the opportunities they currently have on the table.
To manage your pipeline efficiently, avoid getting lost in the minutia: define your key metrics and focus on those as you review your pipeline.
By focusing only on those key metrics, you’ll be able to draw actionable insights from your pipeline and manage your process more effectively.
4.Your Sales Pipeline Review Meetings Should Happen More Often
How often do you hold your pipeline review meetings? No matter what your answer is, I’m guessing it should be more often.
2020 has been a year of crisis. During times like these, it’s essential to tighten the cycle of all your meetings, including pipeline reviews.
Forecasting, planning, and goal-setting are all made much more difficult during a time of crisis. By holding pipeline review meetings more often, you can keep a close eye on your sales situation and make plans on a weekly basis rather than a quarterly basis. This tighter meeting cycle puts you in a better position to adjust quickly as the market fluctuates based on the current world happenings.
Of course, preparing for and holding these meetings takes time from your schedule. To optimize the time you spend in each pipeline review meeting, use a meeting agenda template to keep things organized and on track. If you create your agenda template in Google Docs, your whole team can collaborate and add their talking points directly into the agenda.
This agenda template could include items such as:
- Review action items from the last meeting
- Mention victories from the last week/month
- Reps highlight one or two opportunities they’re excited about/facing challenges with and get feedback from the team
- Set clear action items for each rep over the next week
5.Using A CRM To Build Your Sales Pipeline Allows You To Maximize Automations
Since your CRM is the one source of truth for all of your prospect and customer relationships, building your pipeline here allows you to take advantage of automations and workflows that save you time in managing your pipeline.
For example, all lead information is already logged in your CRM. As sales reps interact with prospects, new information is added directly to the system. Any interaction your sales team has with leads and prospects is then recorded into the pipeline, and changes made will automatically update the confidence score, lead stage, deal size, and more.
Most CRMs also automatically calculate pipeline value and forecasts based on expected close dates and deal sizes.
With all the data updated in real-time, your pipeline will be full of actionable insights based on what’s happening right now with your leads and prospects. All this with no extra effort needed on your part.
6.Combining Your Rep Activity Data And Conversion Rates Can Empower Your Team
Do you know how your reps’ activities affect conversion rates?
These two data points are directly linked: If you put them together, you can better enable your team to close deals and more accurately forecast when those deals will close.
Start by calculating the conversion rates for each stage. Then, do the same calculation, but separate it by each rep on your team.
Once you can see each rep’s conversion rates per stage, take a look at their activities and see how each activity affects the average conversion rate.
For example, does a rep who focuses on cold emailing get more leads to convert to the qualification stage? How many phone calls does it take on average to move prospects to the negotiation stage? Do product demos get a better conversion rate than other types of meetings?
When you can tie specific rep actions to higher conversion rates at each stage, you accomplish two things:
- First, you can coach your team with real data, and guide your reps to the right actions at each stage to push deals forward
- Second, you have a more accurate view of how many touchpoints each stage takes to convert, giving you the ability to forecast even better
Managing Your Sales Pipeline Is An Ongoing Process
There is one last thing startups need to understand about sales pipeline management: It is ongoing.
When you build a sales pipeline that’s easy to analyze, track, and optimize, you’ll save valuable time and empower your sales team to sell more effectively.
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